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- W2133602540 abstract "Search and matching models such as those of Mortensen and Pissarides(1994) and Pissarides (2000) have come under criticism in recent years.Analysis of the model by Shimer (2005) and others has focussed inparticular on the models’ inability to generate sufficient volatility in variablessuch as the unemployment and vacancies rates, and the vacancyunemploymentratio. Newer models have sought to ameliorate theseempirical issues by changing the model – for example by adding wagerigidity or by amending the specification of the costs of search.In Chapters 3 and 4 of this thesis, we re-address some of these issuesusing the method of indirect inference. The method allows us to formallytest the hypothesis that data was generated by a particular model under agiven set of parameter values. It therefore offers a statistically foundedreplacement for the somewhat arbitrary moment-by-moment comparisonsfound in much of the existing literature. We apply the method to Shimer’sanalysis of the Mortensen Pissarides model, and concur with his analysisthat, under his chosen parameters, the model fails to fit the data. We alsoapply the method to the model used in Yashiv’s (2006) paper, which arguesusing moment comparisons that the standard model can be improved byadding convex search costs. In contrast, we find that the augmentedmodel is rejected under formal indirect-inference tests.The aggregate search and matching literature has also generated anempirical debate about the relative importance of labour market flows,expressed in terms of the hazard rates of labour market transition faced byworkers. Many studies decompose changes in steady-state unemploymentin terms of the contributions of various hazard rates. This thesis alsoextends this literature so as to model the contributions of hazards for twodistinct and contiguous geographical areas – those of Wales and the rest ofthe United Kingdom, using Labour-Force-Survey panel data. We find someevidence that in this regard, the UK hazards are weighted towards thehazards “out of” unemployment, whereas for Wales the hazards “into” and“out of” unemployment are of approximately equal importance. We alsofind however that the results are sensitive to whether or not the data aresmoothed, and whether a steady-state is imposed." @default.
- W2133602540 created "2016-06-24" @default.
- W2133602540 creator A5034822544 @default.
- W2133602540 date "2014-01-01" @default.
- W2133602540 modified "2023-09-24" @default.
- W2133602540 title "Empirical topics in search and matching models of the labour market" @default.
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